• Sprott Money
    04/29/2016 - 05:58
    There is unfortunately no basis for renewed optimism that this current litigation will have any meaningful impact on precious metals manipulation – with respect to either silver or gold.

Bitcoin Parabola Not Enough? Here Comes Bitcoin Opportunity Fund... This Time With Leverage!

Tyler Durden's picture




 

With Bitcoins changing digital hands for over $260 this morning, having doubled in a week (and exponentially risen in weeks), many have asked how to 'trade' or 'short' this virtual currency. Well, perhaps the answer is here. As TechCrunch notes, Coinsetter - a NY-based startup looking to launch a trading platform for Bitcoin has raised $500,000 in seed capital. The platform will allow leverage (via margin) and the ability to short the market. We can only imagine the hour-by-hour margin changes. Furthermore, Coinsetter intends to offer accredited investors (because wealth equals smarts, right) the ability to earn interest on Bitcoins. To put his money where his mouth is, Lukasiewicz, a former JPM investment banker, has said that he will "put up at least $50,000 of his own money towards the platform's initial margin reserves." Forget NFLX; Ignore FNM; day-trading Bitcoin with leverage is the new normal. What's the opposite of catching a falling knife?

 

Short this...on margin...

 

And from Coinsetter's blog...

 

Via TechCrunch,

Today, Coinsetter, a New York City-based startup looking to launch a new Forex trading platform for Bitcoin, announced today that it has raised $500,000 in seed capital. The round was led by Tribeca Venture Partners and SecondMarket founder and CEO Barry Silbert (through his Bitcoin Opportunity Fund), with participation from angel investors like Jimmy Furland, a London-based technology entrepreneur, Microsoft Head of Corporate Strategy, Charles Songhurst, and Facebook Product Lead, Ben Davenport.

 

...

 

Coinsetter, on the other hand, is one of many that see opportunity in applying familiar market practices to the wild, wacky and virtual world of Bitcoin. With its new funding in tow, the New York City-based startup plans to launch a Forex trading platform for Bitcoin, specifically one that allows people to make leveraged trades on margin and short the market. While these practices are available in all mature markets, says co-founder Jaron Lukasiewicz, “they’re virtually absent in the Bitcoin space.”

 

Coinsetter wants to make Bitcoin more accessible to both mainstream and institutional users by focusing on security, transparency and by offering a simple user experience. On top of that, the startup plans to launch an ancillary arm that will offer a “scalable solution for accredited investors and institutions to earn interest on their bitcoins,” Lukasiewicz says.

 

...

 

To put his money where his mouth is, Lukasiewicz, a former investment banker, has said that he will “put up at least $50,000 of his own money towards the platform’s initial margin reserves,” as reported by The Bitcoin Trader. The article goes on to point out that, while promising, Coinsetter isn’t the only service looking to offer margin trading.

 

There’s also the steadily-growing, Hong Kong-based Bitfinex as well as ICBIT.se, both of which have been around for some time.

 

...

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Wed, 04/10/2013 - 10:12 | 3430989 kushmere
kushmere's picture

Oh, just what we need to get a higher bubble.

http://bestbitcoinsites.wordpress.com

Wed, 04/10/2013 - 10:15 | 3431000 Badabing
Badabing's picture

THIS IS IT!!!!!

a BTC ETF to control the price now they TPTB can short the shit out of it.

Wed, 04/10/2013 - 10:17 | 3431014 Scarlett
Scarlett's picture

At 2.6B USD, a minute fraction of the "rich" world is moving into bitcoin.  A very minute fraction; 10B is less than a week of Ben's weekly printer show.  Remember that, you're still talking about something very small in the grand scheme of things.

Wed, 04/10/2013 - 10:20 | 3431034 MagicHandPuppet
MagicHandPuppet's picture

I LOVE IT!  What could go wrong?

Wed, 04/10/2013 - 10:31 | 3431073 CH1
CH1's picture

Bitcoin, it's the new silver.

Why else would JPM be creating a paper market for it?

BTW: they could just extend the horizontal scale on the graph to make it less scary. Selling fear is not cool.

Wed, 04/10/2013 - 10:32 | 3431099 HoofHearted
HoofHearted's picture

Bitcoin, it's the new Beanie Babies. My kids have some of those if you want to trade them for your bitcoins.

Yes, I wish I was in at $10 per like some of you. I missed that one. But I would say that many of you ought to take your paper profits on bitchez-coins and move it into something a little more solid. Drop those tulip bulbs when you can profit on them. Make like John Law, baby, and get in a carriage full of PMs headed out of France. I wish I'd been as smart as some of you to take some fiat from this scheme so that I could turn it into the shiny stuff.

Wed, 04/10/2013 - 10:45 | 3431214 BigJim
BigJim's picture

 "What's the opposite of catching a falling knife?"

I don't know. Swallowing a rising sword? 

Wed, 04/10/2013 - 10:58 | 3431344 gold-is-not-dead
gold-is-not-dead's picture

if jpm steps into the world of btc, it's the end of jpm... bye, bye, naked shorts...

Wed, 04/10/2013 - 11:33 | 3431563 RebelDevil
RebelDevil's picture

JPM is already almost dead. When the will of the people rise to buy up silver, then it's dead. xD

Wed, 04/10/2013 - 11:57 | 3431715 sitenine
sitenine's picture

Why just go retard when you can go full retard?

Wed, 04/10/2013 - 14:28 | 3432341 Ag Tex
Ag Tex's picture

Something is screaming TPTB are going to do everything in order to tame this filly.

Wed, 04/10/2013 - 13:21 | 3432167 Tango in the Blight
Tango in the Blight's picture

I buy silver and bitcoin.

Of course I can't be happening, one has to be either a gold/silverbug or a bitcoinbug.

Wed, 04/10/2013 - 13:53 | 3432326 Bicycle Repairman
Bicycle Repairman's picture

Now that both hands are on the 'baby', time to 'shake the baby'.

Wed, 04/10/2013 - 11:07 | 3431401 Dick Buttkiss
Dick Buttkiss's picture

No, that would be sitting on a rising sword, which you then upchuck

Ouch!

Wed, 04/10/2013 - 10:50 | 3431259 ParkAveFlasher
ParkAveFlasher's picture

I wish I had money to launder, in which case I'd prefer BitCoin.

Wed, 04/10/2013 - 10:59 | 3431336 Kirk2NCC1701
Kirk2NCC1701's picture

"I wish I had any sizable assets to move out, in which case I'd use Bitcoin" is more appropriate.  For those who like their Constitutional Privacy, and the right not to pay ongoing Rent on their wealth.

Wed, 04/10/2013 - 11:06 | 3431384 CH1
CH1's picture

Precisely.

Wed, 04/10/2013 - 11:30 | 3431536 resurger
resurger's picture

/d

Wed, 04/10/2013 - 11:29 | 3431539 resurger
resurger's picture

dont even compare silver to bitshit...

Wed, 04/10/2013 - 10:22 | 3431048 New England Patriot
New England Patriot's picture

If the upward limit on BTC is 21 million units, and we're currently at 11 million units, and assuming people continue to adopt Bitcoins, then the value of a Bitcoin will continue to go up, right?

 

When a Bitcoin is worth $10,000.00, what good is that for a transaction to buy a $9.99 book on Amazon?

 

It seems BTC is a good store of wealth, but is it a good medium for wealth transfer (transactions)?

Wed, 04/10/2013 - 10:33 | 3431113 taniquetil
taniquetil's picture

I think the biggest problem is that the people adopting them right now are doing it for the price increases, rather than for the value as a transactional tool. Yes, some might be Russian's trying to hide money from the government, but most people are watching the MSM reports and riding the wave up.

 

As soon as BTC becomes a transactional tool for mainstream corporates, who have to convert it into dollar, you will get price suppression.

Wed, 04/10/2013 - 10:57 | 3431334 NoDebt
NoDebt's picture

That's probably what will happen if it lives that long.

Wed, 04/10/2013 - 11:01 | 3431352 gold-is-not-dead
gold-is-not-dead's picture

When a Bitcoin is worth $10,000.00, what good is that for a transaction to buy a $9.99 book on Amazon?

just transfer
0.001btc

 


Wed, 04/10/2013 - 12:05 | 3431774 XitSam
XitSam's picture

I was thinking BTC were in the mania phase. But it isn't. No one has entered in a big way. Brokers are not saying buy BTC. Shoe shine boys (are we still allowed to say that? Then newpaper boys? OK, taxi drivers) are not giving hot tips on BTC. Mania phase yet to come. Me, I lost all my bitcoins in a tragic boating accident.

Wed, 04/10/2013 - 10:37 | 3431130 kushmere
kushmere's picture

Ah, many people have this misconception.

A single bitcoin can be divided into units as small as .00000001

right now, .001 BTC is about 25cents

http://bestbitcoinsites.wordpress.com

Wed, 04/10/2013 - 10:40 | 3431170 New England Patriot
New England Patriot's picture

That clears up my misconception. Thanks.

Wed, 04/10/2013 - 10:56 | 3431319 ParkAveFlasher
ParkAveFlasher's picture

Interesting questions raised by finite supply, even if it's trillions of increments, involving pricing and transactional distortion during market corners.

Might be seeing it happen right now. 

BitCoin may be the only unimpeded free market for large currency swaps in the world right now.

Wed, 04/10/2013 - 12:56 | 3432031 Citxmech
Citxmech's picture

I want to know what happens when competing protocols are introduced for "DataCoins," "Digibux," "BinaryBux," "DigiDollars," "ByteMeBux," etc. etc.

And if BitCoins ever did escape suppression and start heading toward it's potential to supplant central bank issued fiat as a medium of exchange, the biggest question would be what the Au/BC ratio would look like.

Wed, 04/10/2013 - 10:36 | 3431134 A Lunatic
A Lunatic's picture

I've got some virtual oceanfront property in Arizona for sale. Let's talk.

Wed, 04/10/2013 - 10:43 | 3431178 McMolotov
McMolotov's picture

When a Bitcoin is worth $10,000.00, what good is that for a transaction to buy a $9.99 book on Amazon?

Better question: What's the value of a Bitcoin when the government outlaws it as a competing currency, labels it a tool of terrrists, and colludes with big businesses such as Amazon to drive it into permanent black market status?

Wed, 04/10/2013 - 10:58 | 3431333 Arkadaba
Arkadaba's picture

Agree. While I love the idea, there is no way TPTB will let this stand if it gains momentum with the larger public. In the past decade whole countries have been taken down for daring to suggest they wanted to go off the petro-dollar! Regardless of what its proponents say Bitcoin will be taken down if the gov and/or banksters so desire.

Wed, 04/10/2013 - 11:19 | 3431476 Mine Is Bigger
Mine Is Bigger's picture

Many people seem to share your sentiment, but I wonder.  It is not as if bitcoins decrease the supply of fiat. Why do they care?  As long as goods and services are priced in dollars (in the case of the U.S.), whether the bitcoin is at $100 or $200 does not make any difference to the fiat world.  Any thoughts?

Wed, 04/10/2013 - 11:40 | 3431609 ATM
ATM's picture

Think of it the other way around. 

It isn't the supply but the demand for fiat that is threatened. They can print as much as they like but when Joe Blow demands from his employer to be paid in bitcoins thent TPTB have a problem. The lynch pin of their powers over us is control of the currency. 

We are certainly within our rights to use whatever currency we deem appropriate. We simply are barred from counterfeiting government issued currency but Bitcoin is not that. Bitcoin, or any ther competing currency, has to be stopped for them to retain their powers and exert even more.

Bitcoin will be imploded one way or another. Has to be. Probably by a "terrorist" attack/hack or some shenanigans where someone at bitcoin is caught embezzling. Something that providees cover but shakes the confidence.

Wed, 04/10/2013 - 11:58 | 3431683 Mine Is Bigger
Mine Is Bigger's picture

Of course, I understand your point of view.  If bitcoin ever becomes so widely accepted as being used to pay wage, then I'm sure they won't like it.  But I am not sure whether the price is $10 or $200 will be a compelling enough reason for them to come down on bitcoins.  The way it is going, the thing could collapse on its own without any meddling.

Wed, 04/10/2013 - 11:21 | 3431485 Matt
Matt's picture

"What's the value of a Bitcoin when the government outlaws it as a competing currency"

Well, if JPM and GS seriously get into it, that will never happen. Especially if they end up with some massive naked shorts outstanding. So, I guess the benefit is protection from the government, at the cost of suppressed prices?

Wed, 04/10/2013 - 12:13 | 3431824 dark pools of soros
dark pools of soros's picture

so you are saying the 'paper bitcoin' market is somehow going to do a bit of shit to the real value of bitcoins in the blockchain?

everyone takes delivery of bitcoins...  why are 90% of the folks here such in love with JPM, Ben, Squid, etc?

Wed, 04/10/2013 - 13:21 | 3432168 Matt
Matt's picture

With paper derivatives to gamble with for the speculators, only people who actually use bitcoin will want to actually hold them. If this happens, I suspect:

1. BTCUSD to drop

2. After the big drop, a much lower volitility, since there can be billions of $ in derivatives for every million $ in actual assets.

Look at gold, silver, everything else; do you really believe that bitcoin will be immune to the same manipulation that affects everything else?

Wed, 04/10/2013 - 12:11 | 3431811 dark pools of soros
dark pools of soros's picture

So many pro government folks here.... 'just u wait till Uncle Sam comes home, I'm a telling and u gonna get a whippin!'

 

Wed, 04/10/2013 - 11:02 | 3431357 Kirk2NCC1701
Kirk2NCC1701's picture

Did you flunk math, or did not DYOH (Do Your Own Homework)?  As a mathematical unit, it can be divided into any tiny fraction.  E.g. 0.000,000,000,001 BTC.

Wed, 04/10/2013 - 11:15 | 3431442 Overflow-admin
Overflow-admin's picture

DYOH Dude

"To ensure this granularity of the money supply, clients can divide each BTC unit down to eight decimal places (a total of 2.1 × 1015 or 2.1 quadrillion units).[63]"

Wed, 04/10/2013 - 11:41 | 3431613 ATM
ATM's picture

That's not enough for Japan.

Wed, 04/10/2013 - 12:14 | 3431830 dark pools of soros
dark pools of soros's picture

the lowest division is called a Satoshi

 

Wed, 04/10/2013 - 11:43 | 3431637 New England Patriot
New England Patriot's picture

God bless you.

Wed, 04/10/2013 - 13:30 | 3432206 ProtectiveFather
ProtectiveFather's picture

Bold use of commas on the right side of the decimal. I appreciate a man who charts his own course.

Wed, 04/10/2013 - 10:28 | 3431088 defencev
defencev's picture

I am moving all the way too: I will invest all sea shells I will be able to collect on Phuket beach during my coming vacations in this great fund.

Wed, 04/10/2013 - 10:34 | 3431114 SWIFT 760
SWIFT 760's picture

Be sure to check out Patong Beach. Plenty of girly action and the foreign chicks go topless...oh, and a few sea shells, I suppose.

Wed, 04/10/2013 - 10:36 | 3431105 smlbizman
smlbizman's picture

http://www.youtube.com/watch?v=MhPdzjocFwI

yep, it is virtual, no counterparty risk, peer2peer, impossible to manipulate, blah, blah , blah.....its never different tjis time...if its to good to be true , it is...look you have something on your shirt.......if this news doesnt flatten this bubble, than the people we thought that were buying btc, you know the ones that are sticking to and achieving freedom from the "system"....wasnt really them.....it has been the same crooks that control  all the other  the systems......

Wed, 04/10/2013 - 10:40 | 3431169 Silver Garbage Man
Silver Garbage Man's picture

You can say the same thing about silver.....AND IT IS TANGIBLE!

Wed, 04/10/2013 - 10:59 | 3431348 smlbizman
smlbizman's picture

i think i did....the crooks control all other systems...that includes air

Wed, 04/10/2013 - 13:51 | 3432309 Pseudo Anonym
Pseudo Anonym's picture

yeah, but who cares

you're still talking about something very small in the grand scheme of things.

look at how much money can be made on stupid penny stocks by penny stock promoters.  this is no different.  short the bitch.  make money.

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